November Beef Exports Remain on Record Pace

Beef exports totaled 112,842 metric tons (mt) in November, up 1% from a year ago, while value climbed 6% to $709.2 million. At $7.63 billion, beef export value was up 16% and has broken the full-year record set in 2017.
( Drovers )

Editor’s note: November export data was released about one month later than usual due to the recent government shutdown. Year-end 2018 data is expected to be available in early-to-mid March.

U.S. beef exports continued on a record pace in November while pork exports trended lower year-over-year, according to statistics released by USDA and compiled by the U.S. Meat Export Federation (USMEF).

Beef exports totaled 112,842 metric tons (mt) in November, up 1 percent from a year ago, while value climbed 6 percent to $709.2 million. For January through November, exports reached 1.24 million mt, up 8 percent year-over-year and 6 percent above the record pace of 2011. At $7.63 billion, beef export value was up 16 percent and has already broken the full-year record set in 2017 ($7.27 billion).

Beef export value per head of fed slaughter is also on a record pace, averaging $322.97 in November (up 5 percent from a year ago) and $320.72 during the first 11 months of 2018 (up 14 percent). Exports accounted for 13.1 percent of total November beef production and 10.9 percent for muscle cuts, both steady with November 2017. For January through November, exports equated to 13.4 percent of total production and 11.1 percent for muscle cuts – up from 12.8 percent and 10.3 percent, respectively, in 2017. These numbers highlight the strong international demand for U.S. beef as exports are accounting for a larger share of growing U.S. production and are fetching higher prices, with some U.S. cuts trading at record prices in Asia.

"2018 was truly a remarkable year for U.S. beef exports, which shattered previous records in both volume and value and reached new heights in several of our top markets," said USMEF President and CEO Dan Halstrom. "In the first half of the year, pork exports were also on a very positive trajectory but unfortunately U.S. pork has been heavily targeted for retaliation. We remain hopeful that these disputes can be resolved soon, so that U.S. pork can get back on a level playing field with its competitors."

Asian markets set pace, but beef export growth widespread

November was another strong month for U.S. beef exports to the key Asian markets of Japan, South Korea and Taiwan, while exports to the ASEAN region also increased sharply. For January through November, beef export highlights include:

Exports to leading market Japan were up 7 percent year-over-year in volume (306,603 mt) and 10 percent in value ($1.93 billion). But market access to Japan is a major concern for the U.S. beef industry, as key competitors recently joined Australia in benefiting from an 11 percentage point tariff advantage through the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP). U.S. beef remains subject to the 38.5 percent tariff rate and to Japan’s quarterly safeguard mechanisms. Competitors’ tariffs will decline again on April 1, the start of the Japanese fiscal year. The Trump administration has announced its intention to negotiate a trade agreement with Japan, but formal negotiations have not yet begun.

U.S. beef has already shattered the previous yearly value record in Korea, with export value soaring 45 percent to $1.6 billion, while volume was up 32 percent to 220,770 mt. Although Korea’s imports from Australia and New Zealand also edged higher in 2018, U.S. market share increased significantly – reaching nearly 50 percent in volume and 56 percent in value. Through the Korea-U.S. Free Trade Agreement (KORUS), the duty rate on U.S. beef to Korea is 18.7 percent this year, down from 40 percent prior to implementation.

Exports to Taiwan were up one-third from the record totals posted in 2017, reaching 53,626 mt valued at $495.7 million (a record for the sixth consecutive year). The U.S. holds more than 75 percent of Taiwan’s chilled beef market, the highest of any Asian destination.

Beef exports to Hong Kong were lower year-over-year in volume (109,082 mt, down 4 percent), but export value still climbed 13 percent to $865.3 million. Exports to China totaled 6,567 mt valued at $55.1 million. U.S. beef regained access to China in mid-2017, making year-over-year comparisons difficult. But in the second half of 2018, export volumes to China were higher year-over-year in every month except September, and November exports reached a new monthly high of 890 mt, despite an additional 25 percent retaliatory duty.

Led by strong increases in the Philippines and Vietnam and slightly higher shipments to Indonesia, beef exports to the ASEAN region climbed 19 percent year-over-year in volume (45,255 mt) and 31 percent in value ($252.4 million).

Although beef exports to Mexico were up just 1 percent year-over-year in volume (218,281 mt), export value to Mexico climbed 8 percent (to $966.7 million) and will exceed $1 billion for the first time since 2015. The hike in value reflects a strong year for beef muscle cut exports to Mexico, which increased 7 percent in volume (130,330 mt) and 11 percent in value ($759.2 million).